As sterling slumps, 95pc of Irish hoteliers fear impact of Brexit on visitor numbers from the UK
Published 07/07/2016 | 02:30
Almost all Irish hoteliers have seen an increase in business this year, but are concerned that Brexit will have a negative impact.
And a survey from the Irish Hotels Federation (IHF) shows that hoteliers have identified local rates as the most pressing issue affecting their cost competitiveness.
The quarterly barometer from the federation reveals that 49pc of hoteliers are "very concerned" about Brexit, with 46pc saying they're "concerned".
The UK accounts for 40pc of overseas visitors to Ireland. The slump in the value of sterling against the euro is certain to impact the number of travellers visiting Ireland from the UK. Prior to the EU referendum, British visitors had enjoyed a strong currency differential when visiting Ireland.
IHF president Joe Dolan said that the concerns expressed by hoteliers following the referendum reflect the "significant risks" the sector faces. He said many hotels and guesthouses are still in recovery mode.
"This comes at a time when the increasing cost of doing business in Ireland already poses a serious challenge for tourism businesses," he said.
"While it is too early to predict the full effect that the decision will have on Irish tourism, there can be no room for complacency, particularly given the potential impact on visitor numbers from the UK and business levels within the domestic market."
A recent report by CBRE said that the Brexit vote "has the potential to have severe repercussions for the whole and tourism sector in Ireland".
The latest barometer found that 30pc hoteliers are still concerned about the viability of their business over the next 12 months, notwithstanding any impact from the UK's pending departure from the EU.
But 90pc of hoteliers said they've seen stronger business so far this year than in the first half of 2015.
The number of overseas visitors to Ireland is 14pc higher in the year to date, with the number of British visitors up 16pc in the period.
Two out of three hoteliers are seeing an increase in home-grown business with an uplift in consumer confidence leading to more people taking holidays and short breaks at home, said the IHF.
Of those hotels catering for corporate meetings and business events, 60pc have seen an increase in this area of their business compared with last year, according to the IHF survey.
Unsurprisingly, Mr Dolan stressed that the 9pc special VAT rate that was introduced to support the hotel and some other services sectors, remains a key component of the industry's revival.
Of the hoteliers surveyed, 73pc having increased staffing levels over the last 12 months and the vast majority planning to either take on additional staff or maintain current levels over the coming next year, they told the IHF.
The survey also found that 89pc of hotels will benefit from refurbishment and increased capital investment over the next 12 months, while 63pc intend to increase their marketing spend.
CBRE said this week that 15 hotels were sold in Ireland in the second quarter, bringing the total number of hotel sales in the first half of the year to 29.